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Moneylife » Life » Public Interest » 2011: A year dedicated to MLM and Ponzi scheme frauds

2011: A year dedicated to MLM and Ponzi scheme frauds

Moneylife Digital Team | 27/12/2011 03:00 PM | 

Moneylife has been in the forefront for highlighting frauds committed by MLM and Ponzi schemes. We hope the government brings a strong regulation to curb such schemes, in the interest of the public at large

If 2010 was the year of great Indian scams, 2011 was rather of ponzi and multi level marketing (MLM) frauds. SpeakAsia managed to top the chart, but soon many others joined the bandwagon, duping gullible investors for several thousand crores.
In India, MLM and schemes promising easy high returns are not unusual. Since the start of this year, Speak Asia was new a buzzword. From college students to housewives, everyone was ensnared by it and invested in the scheme on the promise of easy weekly returns, merely on filling online surveys. Though the company paid the promised income in the beginning, there were certain grey areas in its business model. SpeakAsia was registered in Singapore, and was working in India without any office, and was not registered with registrar of companies.

Moneylife was the first media organisation to raise a red flag regarding the business model of Speak Asia (  Soon its dubious nature was exposed in the mainstream media during its Goa bash that was held in May. Despite ambiguities prevailing in the scheme, the regulators remained tight lipped. Moneylife repeatedly urged the Reserve Bank of India (RBI) to investigate the company’s money trail, since a lot of money was amassed and sent to Singapore. But nothing was done and finally the scheme collapsed, duping 19 lakh gullible investors. Currently the top bosses of SpeakAsia are absconding while other employees are arrested. The Economic Wings (EOW) Department, Mumbai is investigating the scheme. Sources from EOW tell us that already substantial amount of money has reached Singapore.  

Stock Guru India, grabbed headline in April after its founder Lokeshwar Dev, duped investors for whooping Rs1,000 crore (  This fraud company, operating as a self-styled investment advisor, openly flouted norms laid down by the market regulator Securities and Exchange Board of India (SEBI) and offered 120% returns in a year through stock market investment. SGI was not registered with SEBI as an investment advisor, but still offered to trade on behalf of clients. It also operated without any trading licence from the RBI and SEBI. Moneylife, much before (in December 2010) the scheme collapsed, had pointed the dubious modus operandi of the scheme ( Again SEBI ignored and remained silent.

In June 2011, frustrated with the mushrooming MLM schemes, the Kerala police started an investigation into these schemes and closed many of them. The police admitted noticing frauds amounting to over Rs1,000 crore in the state. Following the hue and cry from a number of investors, investigating agencies from Kerala started probing several multi-level marketing (MLM) companies—two prominent names among these were Tycoon Empire International and Bizarre group of companies. It arrested some of the promoters. Many of these cases had inter-state ramifications and were handed over to the crime branch in Kerala. Media reports have quoted Jacob Punnose, director general of police (DGP), Kerala, as saying that these investigations would be completed within five to six months. Chennai-based Tycoon Empire International had collected Rs370 crore from 50,000 investors, while Bizarre group collected Rs55 crore from depositors. Besides these two names, another MLM company cheated people of around Rs300 crore. It operated 14 accounts in a private bank, using false names and addresses.  ( MLM company Nano Excel came under the scrutiny of the Karnataka police after it cheated its investors for Rs9 crore.

In November, Jaipur-based multi-level marketing (MLM) company, Gold Sukh, has allegedly duped over 1.75 lakh investors for over Rs200 crore ( company promised investors 27 times returns in just 15 months on their deposits for buying gold. Police arrested officials of the company and issued a red corner notice through Interpol against the absconding directors of the company.  

The chief minister of Rajasthan has asked officials to draft a bill against fraudulent MLM schemes against the backdrop of the on going investigation in the multi-crore Gold Sukh scam.

Even while the EOW Mumbai was investigating SpeakAsia scam, it successfully arrested a fraudster of another MLM company. In October, EOW arrested Rahul Patil, managing director of Symbiosis Gold Trade. Interestingly, when Mr Patil was bought to the local court in Mumbai, some duped investors—mostly women—hurled chappals at him. It promised Rs1.20 lakh profit at the end of year apart from the actual investment of Rs1 lakh.

EOW Mumbai, in November 2011, unearthed another fraud by MLM scheme, Yellow Sapphire Multi-Trade Pvt Ltd, after it cheated around 2,000 investors. According to the company’s scheme, on investing a sum of around Rs6,000, one would get a gold pendant worth the invested amount along with additional Rs840 on introducing two new members to the scheme.

Despite the EOW’s strict action, many schemes continue to flourish. In fact schemes which in past have duped investors have made a come-back. For instance, Gold Quest, which came under the scanner of investigating authorities, is once again trying to spread its reach to the investor. The company, registered in Singapore, has been banned in many countries. It has re-launched itself in India and is said to be successful in attracting new investors from Mumbai.  Gold Quest has now renamed as Q-Net or Quest Net, is selling a certain products including watches, holiday packages ranging from anything between Rs30,000 to Rs7 lakh. The company started by selling limited edition numismatic gold coins through a pyramid structure for Rs30,000. It claimed the coins were made in Germany and will appreciate in value, over a year, which will and fetch huge returns to the buyer.

Moneylife Foundation, a not-for profit organisation which spreads financial literacy, had send an memorandum to the Prime Minister’s Office urging the PM and others to completely ban MLM companies in India or bring these companies under the regulation of either RBI or SEBI. (

Hope in 2012 the government brings a strong regulation to curb MLM and pyramid schemes, in the interest of the public at large.

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gurupreet 1 year ago

Hello Friends, since i got my FIR registered in the month of August, it has been three months QNET has failed to re-start the "SYSTEM" In mumbai. First they had to cancel their grand celebration planned to be held at "Holy Spirit Hospital" Hall in andheri-east.

Later these QNETERS tried to do a "system" in Islam Gymkhana and had to cancel that also.

It is said that the third time these people placed advertisements in newspapers of mumbai to invite people into investing into a "Business Opportunity" and were holding that meeting in hall in dadar-west.

It is being said that today morning crime branch officials raided several residential places of QNET leaders all over mumbai and the following were detained/arrested.

Vivek Kumar Singh

Shashi Bushanrameshwar Pandey

Namrata Pandey

Sabina Mathews

Vijay Mathews

Jagdev Singh Parmar

Rohit Chandra

Mahesh Bhansali

All the above people have shared the "proceeds of crime" and huge amounts of money had been transferred into their bank accounts under the guise of "commissions paid". Sources say these huge amounts of money has been raised by running a money circulation scheme in India under the guise of "ecommerce" by QNET India.

It is now upto the rest of QNET IR,s to decide whether they want to continue to be part of this crime of "money circulation scheme" or they want to join the investigation and help the police and become "Government Aprovers".

It is your choice you want to become a accused in this crime, because some day some one will surely report you, it is better to give up this "white collared crime" now itself, then land into trouble later.

I appeal to you all IR,s to give this anti national activity once again, Please do not forget this is not happening the first time. Previously also in chennai assets,properties,cars, bank accounts etc of all TOP IR,s and team leaders were sealed by chennai CID.

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anju 1 year ago in reply to gurupreet

gurpreet bhai,cigrate aur whisky jismain billion dollar ja reha hain logo ka,pepsi aur cola jismain billion dollar ja reha hain logo ka aur mar bhi rahe hain,aur srif ek actor jo advertise karta hain ya advertisemnt company pura paisa rakh leti hain,uske liye kyu fir nhi ki,jisse sara paisa india k bahar ja reha hain,aur log mar rahe hain,iss jahar ko pi k,jis network marketing k pichhe aap pade ho usse bahut logo ko fayeda hota hain kyuki ye person to person product selling hoi hain,maine iska holiday pack liya hain,aur wo market se bhi sasta hain,aur sath main ager koi mera friend ager holiday per jana chahta hain to usko advise deta hu usmain usko bhi profit hota hain aur mujhe bhi,(advertisement main to jahar bhi bik jata hain aur sara paisa ya to add company khati hain aur ya fir pepsi cola cigrate aur whisky wali company)isko ban karna jaruri hain na ki direct selling ko,please dont do this logo ki bad duaa lagegi tumko jo iss business se kuch kamana chate hain unki kyuki koi mediam cat iss biz se kama sakta hain aur high amount kyuki ismain advertisement company ko profit nhi milta,

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satish 1 year ago in reply to anju

Good Anju Keep it up nice
sab aam admi ke piche pad jate hai paise walo ka paisa kamane me koi dikkat nahi sirf aam admi ko hai chutiye hai sale sab jo mlm ko froud bol rahe hai khud konse dudh ke dhule hua hai baiman hai sab

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jitu moni

jitu moni 1 year ago in reply to satish

Complaints are pouring in, a fact accepted even by ACP Mumbai Police. Read his interview and a dashing filmi blowup of Guru :-)

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gurupreet 1 year ago

Now Absconding Accused Vijay Easwaran disowns "QNET INDIA"

These are experts taken from the interview of Absconding Accused Vijay Easwaran

“QNET operates in India through a Franchise company hence Absconding Accused Vijay Easwaran has no involvement in it, he is neither a director nor a shareholder of Qnet India.

He further threatened to seriously think of Pulling out of INDIA.”

BOSS, you are talking of pulling out? YOU and YOUR SCAM will be KICKED out of my nation INDIA wait and see and this will not be the FIRST TIME that you are KICKED at your FAT A$$ and thrown out, will follow your SHAM company and expose it till you call it QUITS, the sooner you PULL OUT the better warna you know that saying “Badey Beaabroo ho kar terey dar sae nikley”

So Mr. Absconding Accused Vijay Easwaran if you have a BRAIN to think of new new SCAMS there are people who can work together to EXPOSE your SCAMS...r u ready for it now….hahaha

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gurupreet 1 year ago

Seminar of Illegal MLM/Money circulation/Binary Marketing Schemes on 20th of September 2013 at 3.30 Pm, Free entry, Please register A.S.A.P.

Come on Friends a golden opportunity for us LIKE minded people to come together and share our thoughts and experiences regarding this menace being played in India on the name of MLM/Network marketing and what not. LETS MEET !! YES !!

Saradha, Speak Asia, QNet, City Limouzine, StockGuru India, Sahara, MPS Greenery, NMart Retail… All these start as hot, new, investment opportunities and as alternative careers that offer high earnings and ways to escape the drudgery of 9-to-5 jobs. But, eventually, most of them fetch only small additional income and, worse, encourage you to lure and mislead your closest friends and relatives. You need to know how multi-level marketing (MLM) schemes and ponzis can destroy a large chunk of your savings or push you into debt. Understand the mechanics of these schemes, the laws that are applicable to them and why regulators fail to rein in dubious enterprises before they cheat thousands of people. Understand the basics of how to keep your money safe—the first step to smart investment! Collective investment schemes are not even under SEBI's regulation.

Sucheta Dalal, founder trustee of Moneylife Foundation and Managing Editor of Moneylife magazine, is one of the best known financial journalists in India. She has worked with many of India's leading newspapers including Times of India, Indian Express, Economic Ti mes and Business Standard. She was awarded the Padma Shri in 2006 for her investigative journalism spanning over 25 years which included exposing the Harshad Mehta scam in 1992. Sucheta Dalal will be conducting this seminar.

For registration please Contact:
Seraphina / Komal
at 022-49205000 or
Log on to

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gurupreet 1 year ago

This video is so FUNNY, every one should watch it..will lighten up your day :)

Say thanks to creator James for doing this :)

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gurupreet 1 year ago

All these words or sentences means the SCAM called QNET…

Listed below are some of the lines or words which mean nothing but QNET aka SCAM

Owner at Global marketing project
A Visionary at Global Marketing Project
Retired at I am THE COMPANY
e-Entrepreneur ! at Entrepreneur
Co Founder at My Office My Health
Global Marketing Projects at E- Enterprenuer
Works at Self Employed and Loving It!
Global Partner at Qnet
Worked at I am unemployable
Business Owner at Business Owner of a Global E-Franchise
Worked at Qnet
Past: THE V and QNET | Faith Egypt | Team Bring It

Global Entrepreneur at QNET (Official)
Past: InService Brotherhood Bootcamp
Works at Achieving the Dream
Chief Executive Officer at Unemployable
Works at Retired
Prosperity Consultant at Faith - Empowering You, Life & Business Coach, JPO Consultant, Networker at Tigers - Leveraging Vision andIndependent Consultant at QNET (Official)
Past: Genpact
Studies Leadership management style at Swiss E-learning Institute
Former Partnership at QI intl
Works at Self Employed and Loving It!
Worked at Honkong Based Multi Billion Dollar Company
Worked at Self-Employed (Business-Entrepreneur)
Retired of a JOB at Social Entrepreneur
Partner at ßusiness of Imp0rts & Exp0rts
Owner at E-Entrepreneur
Works at
Chief Executive Officer at Briltime Corp

If you see any of the above keywords on social media profiles of people trying to catch up with you ..just RUN RUN RUN :P


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